HOUSE BILL 172

53rd legislature - STATE OF NEW MEXICO - second session, 2018

INTRODUCED BY

Bill McCamley

 

 

 

 

 

AN ACT

RELATING TO ECONOMIC DEVELOPMENT; ENACTING THE FILM PRODUCTION REVOLVING LOAN FUND ACT; CREATING THE FILM PRODUCTION REVOLVING LOAN FUND; PROVIDING FOR THE ISSUANCE OF BONDS; MAKING AN APPROPRIATION.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. [NEW MATERIAL] SHORT TITLE.--This act may be cited as the "Film Production Revolving Loan Fund Act".

     SECTION 2. [NEW MATERIAL] DEFINITIONS.--As used in the Film Production Revolving Loan Fund Act:

          A. "authority" means the New Mexico finance authority;

          B. "chief executive officer" means the chief executive officer of the authority;

          C. "division" means the New Mexico film division of the economic development department;

          D. "film project" means a motion picture or television production that can be viewed or reproduced and that is intended to be exhibited in theaters or licensed for exhibition by individual television stations, groups of stations, networks, cable television stations, internet or other new media platforms, nationally or internationally;

          E. "fund" means the film production revolving loan fund; and

          F. "qualified project" means a project that satisfies the requirements of Section 4 of the Film Production Revolving Loan Fund Act.

     SECTION 3. [NEW MATERIAL] FILM PRODUCTION REVOLVING LOAN FUND--CREATED--ADMINISTRATION.--

          A. There is created in the authority a revolving loan fund to be known as the "film production revolving loan fund". The fund shall be administered as a separate account by the authority, and the authority shall adopt rules necessary to administer the fund in accordance with the New Mexico Finance Authority Act.

          B. The fund shall consist of:

                (1) payments of principal and interest on loans for qualified projects;

                (2) money appropriated by the legislature to the fund;

                (3) income from investment of money in the fund; and

                (4) money otherwise accruing, appropriated, distributed or allocated to the fund for the purpose of financing film projects filmed or produced wholly or substantially in New Mexico.

          C. Money in the fund is appropriated for expenditure by the authority to provide loans for qualified projects.

          D. Money in the fund not needed for immediate disbursement, including money held in reserve, may be deposited with the state treasurer for short-term investment pursuant to Section 6-10-10.1 NMSA 1978.

          E. The authority shall establish fiscal controls and accounting procedures that are sufficient to assure proper accounting for fund payments, disbursements and balances.

     SECTION 4. [NEW MATERIAL] LOAN RESTRICTIONS--LOAN PROCESSING.--

          A. The authority may make loans from the fund for qualified projects, subject to the loan restrictions set forth in Subsection B of this section and the prioritization set forth in Section 5 of the Film Production Revolving Loan Fund Act.

          B. If a loan is made pursuant to the Film Production Revolving Loan Fund Act, the following restrictions shall apply:

                (1) not more than fifty percent of the estimated project cost or one million dollars ($1,000,000), whichever is greater, shall be invested in any one film project;

                (2) the loan applicant shall demonstrate that a distribution contract is or will be in place with a reputable distribution company at the time of the loan approval;

                (3) the loan applicant shall post a completion bond that has been approved by the division;

                (4) the loan applicant shall certify no less than fifty percent of the estimated total project cost will be from other sources;

                (5) up to one-half percent of the principal loan amount may be appropriated from the fund to pay administrative costs incurred by the authority, including the reasonably necessary costs of originating and servicing loans;

                (6) the rate of interest on a project loan shall be determined by the chief executive officer at the time of the loan approval and the rate of interest shall be equal to or greater than the rate of interest on the most recent senior lien securities funded by the public project revolving fund pursuant to Subsection D of Section 6-21-6 NMSA 1978 plus one-half percent; and

                (7) no loan shall be made if the applicant for a loan has received a previous loan from the fund and there remains a principal balance outstanding at the time the application is submitted for consideration by the authority.

          C. The chief executive officer may request a review and recommendation of the loan application by the division.

          D. All loan approvals are subject to rules promulgated by the authority.

     SECTION 5. [NEW MATERIAL] PRIORITIZATION OF LOANS FOR QUALIFIED PROJECTS.--The authority shall promulgate rules for a system for the ranking of qualified projects seeking loans pursuant to the Film Production Revolving Loan Fund Act. The ranking system established pursuant to this section shall be reviewed annually by the authority and shall give priority to qualified projects that meet the following criteria:

          A. the project director is a New Mexico resident;

          B. the project lead writer or a majority of a writing collaboration team are New Mexico residents;

          C. the project lead producer or a majority of a team of producers are New Mexico residents;

          D. the project story content is based in New Mexico; and

          E. the project films on locations within New Mexico where the population density based on the most current tract level population estimates published by the United States census bureau is less than twenty-five persons per square mile.

     SECTION 6. [NEW MATERIAL] AUTHORIZATION TO ISSUE ADDITIONAL SHORT-TERM SEVERANCE TAX BONDS--APPROPRIATION TO THE FILM PRODUCTION REVOLVING LOAN FUND.--

          A. In fiscal year 2018, in addition to the bonds issued in accordance with Section 7-27-14 NMSA 1978 and notwithstanding the limitations of that section, when the New Mexico finance authority certifies the need for the bonds, the state board of finance shall, in accordance with the Severance Tax Bonding Act, issue and sell up to ten million dollars ($10,000,000) of severance tax bonds whose terms end on or before June 30, 2018.

          B. Upon certification by the authority pursuant to Subsection A of this section, the state board of finance shall issue and sell bonds up to the amount specified in Subsection A of this section only if the balance in the severance tax bonding fund as of the date that the bonds are issued exceeds the sum of:

                (1) the debt service scheduled to be paid during the remainder of the fiscal year on all outstanding severance tax bonds and supplemental severance tax bonds; and

                (2) the amount necessary to meet all principal and interest payments on outstanding bonds payable from the severance tax bonding fund on the next two ensuing semiannual payment dates.

          C. The state board of finance shall schedule the issuance and sale of bonds provided for in Subsection B of this section as expeditiously and economically as possible. The board shall further take the appropriate steps necessary to comply with the United States Internal Revenue Code of 1986, as amended.

          D. Proceeds from the sale of bonds provided for in Subsection B of this section are appropriated to the film production revolving loan fund.

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